Industry-wide funds pass Z-score test

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The Dutch Association of Industry-wide Pension Funds, the VB, says all compulsory member funds passed the Z-score test, which measures performance against benchmarks, in 2003. “All compulsory member funds of the Dutch Association of Industry-wide Pension Funds successfully passed the 2003 performance test,” the VB has said. Civil service fund Stichting Pensioenfonds ABP had the highest Z-score in 2003, 1.74, giving it a 1999–2003 Z-score of 1.53. The scores were introduced in 1998 as a way to monitor returns on investment against defined targets. “If performance test results over a five-year period are unsatifactory, employers are entitled to claim exemption from mandatory membership of the fund in question,” the VB said. The scores measure how much a fund has achieved the investment objective it has set for itself. This benchmark portfolio is determined by the fund’s board of management. “Yields on investment over a specific year are not the sole measure of assessment,” the VB said. “ Returns must also be appraised against investment risks.”